GM To Make 500,000 Electrified Cars A Year By 2017

Recently, General Motors made a provocative announcement: by 2017, the company plans to produce 500,000 electric and partially electric vehicles each year.

To put that in perspective, in 2011 GM sold just over 9,000,000 vehicles worldwide. If the U.S. auto industry continues its rollicking pace — and if auto markets in the rest of the world keep growing (China, India) or recover (Europe) — GM could easily pass the 10,000,000 mark within five years. That would make electrics and partial electrics about 5% of the company’s total output.

But what kind of vehicles will these be? As our colleagues at Green Car Reports point out, GM isn’t planning to focus much of its attention on hybrids. Yes, it will continue to work on its eAssist hybrid system, which is already found on certain Buick and Chevrolet models. As of October 31, GM had sold about 26,000 eAssist vehicles in 2012.

But GM Product Chief Mary Barra seems to be betting on plug-in hybrids and extended-range electric cars like the Chevrolet Volt, which has sold more than 19,000 units this year. In yesterday’s videoconference, she said, “We think plug-in technology will plan an increasingly important role over the years to come.”

The next of those plug-ins should be the stunning 2014 Cadillac ELR, a swanky, two-door sibling to the Volt. Later this year, at the 2012 Los Angeles Auto Show, GM will also debut the fully electric 2014 Chevrolet Spark EV.

Our take

GM could be onto something, and it’s not hard to see why. Thought the all-electric Nissan Leaf is about $4,000 cheaper than the extended-range Chevy Volt, the Volt has been selling about three times as well.

Part of the difference could be related to distribution, but we have a hunch that range anxiety plays a bigger role. For $4,000 more, eco-conscious consumers can purchase a well-built sedan that’s not limited by battery range. Though the Volt initially had trouble explaining itself to consumers, recent ads poking fun at owners’ “gas anxiety” seem to be having an effect.

GM’s may also be banking on cheaper electric-car technology and increasing economies of scale, which would cut the cost of producing fully electric and range-extended vehicles. If those bets pay off, GM could leapfrog to the front of the eco-friendly pack by forgoing mild hybrids in favor of more advanced-tech vehicles.

That said, it’s important to point out that even though GM’s goals are intriguing, the company still expects that 95% of its vehicles will be sold with conventional combustion engines.

Do you think GM is being too aggressive on its wager? Not aggressive enough? Just right? Feel free to share your thoughts below.